<PAGE>

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

  For the quarterly period ended September 30, 2000 or

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

  For the transition period from         to

                       Commission file number: 333-37186

                     CRICKET COMMUNICATIONS HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                <C>
            Delaware                                 33-0820981
  (State or other jurisdiction                    (I.R.S. Employer
of incorporation or organization)               Identification No.)
</TABLE>

              10307 Pacific Center Court, San Diego, Ca 92121-2779
              (Address of Principal Executive Offices) (Zip Code)

                                 (858) 882-6000
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
   (Former Name, Former Address and Former Fiscal Year, if Changed Since Last
                                    Report)

   Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding twelve months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past ninety days. Yes [X] No [_]

   The number of shares of registrant's common stock outstanding on November
13, 2000 was 1,000.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                                     PART I
                             FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                       (In thousands, except share data)

<TABLE>
<CAPTION>
                                                     September 30, December 31,
                                                         2000          1999
                                                     ------------- ------------
                                                      (Unaudited)
<S>                                                  <C>           <C>
                       ASSETS
                       ------
Cash and cash equivalents...........................   $ 348,382     $   --
Short-term investments..............................      31,490         --
Accounts receivable, net............................          46         --
Inventories.........................................         416         --
Other current assets................................       1,809         --
                                                       ---------     -------
  Total current assets..............................     382,143         --
Property and equipment, net.........................     299,344         505
Investments in and loans receivable from
 unconsolidated wireless operating company..........         --        8,562
Goodwill and intangible assets, net.................      64,646         --
Long-term investments...............................         330         --
Deferred financing costs and other assets...........       3,621         212
                                                       ---------     -------
  Total assets......................................   $ 750,084     $ 9,279
                                                       =========     =======
   LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
   ----------------------------------------------

Accounts payable and accrued liabilities............   $  22,968     $ 6,272
Accounts payable--related party.....................       4,231         --
                                                       ---------     -------
  Total current liabilities.........................      27,199       6,272
Long-term debt......................................     212,580      10,421
Other long-term liabilities.........................      96,177         --
                                                       ---------     -------
  Total liabilities.................................     335,956      16,693
                                                       ---------     -------
Contingencies (Note 5)
Stockholders' equity (deficit):
Preferred stock--authorized 200,000 shares; $.0001
 par value, no shares issued and outstanding........         --          --
Common stock--authorized 75,000,000 shares; $.0001
 par value, 1,000 and 64,306,766 shares issued and
 outstanding at September 30, 2000 (unaudited) and
 December 31, 1999, respectively....................         --            6
Additional paid-in capital..........................     541,711     125,868
Notes receivable from stockholders..................         --      (55,304)
Unearned stock-based compensation...................         --          (29)
Accumulated deficit.................................    (127,583)    (77,955)
                                                       ---------     -------
  Total stockholders' equity (deficit)..............     414,128      (7,414)
                                                       ---------     -------
  Total liabilities and stockholders' equity
   (deficit)........................................   $ 750,084     $ 9,279
                                                       =========     =======
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                       2
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
                                 (In thousands)

<TABLE>
<CAPTION>
                                              Three Months
                            Month Ended          Ended         Nine Months Ended
                          ----------------  -----------------  ------------------
                             June 30,                 September 30,
                          ----------------  -------------------------------------
                           2000     1999      2000     1999      2000      1999
                          -------  -------  --------  -------  --------  --------
<S>                       <C>      <C>      <C>       <C>      <C>       <C>
Operating revenues......  $ 2,020  $   --   $  7,540  $   --   $ 14,409  $    --
                          -------  -------  --------  -------  --------  --------
Operating expenses:
  Cost of operating
   revenues and
   operations...........   (1,932)     --    (10,728)     --    (17,041)      --
  Selling, general and
   administrative.......   (3,591)  (2,947)  (12,907)  (5,992)  (27,301)  (16,414)
  Depreciation and
   amortization.........   (1,063)     --     (3,615)     --     (7,117)      --
                          -------  -------  --------  -------  --------  --------
    Total operating
     expenses...........   (6,586)  (2,947)  (27,250)  (5,992)  (51,459)  (16,414)
                          -------  -------  --------  -------  --------  --------
Operating loss..........   (4,566)  (2,947)  (19,710)  (5,992)  (37,050)  (16,414)
Equity in net loss of
 unconsolidated wireless
 operating company......      --    (2,500)      --    (4,000)  (10,439)  (11,200)
Interest income.........      632      --      6,433       16     8,633        16
Interest expense........   (1,678)     --     (4,968)     --    (10,879)      --
                          -------  -------  --------  -------  --------  --------
    Net loss............  $(5,612) $(5,447) $(18,245) $(9,976) $(49,735) $(27,598)
                          =======  =======  ========  =======  ========  ========
</TABLE>




     See accompanying notes to condensed consolidated financial statements.

                                       3
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
                                 (In thousands)

<TABLE>
<CAPTION>
                                                             Nine Months Ended
                                                               September 30,
                                                             ------------------
                                                               2000      1999
                                                             --------  --------
<S>                                                          <C>       <C>
Operating activities:
Net cash used in operating activities......................  $ (5,953) $ (7,907)
                                                             --------  --------
Investing activities:
  Purchase of property and equipment.......................   (27,845)     (115)
  Investments in and loans to unconsolidated wireless
   operating company.......................................    (9,900)  (11,200)
  Purchase of held-to-maturity investments.................   (31,820)      --
  Acquisition, net of cash acquired........................    (1,327)      --
                                                             --------  --------
Net cash used in investing activities......................   (70,892)  (11,315)
                                                             --------  --------
Financing activities:
  Proceeds from long-term debt.............................       302       --
  Net proceeds from issuance of common stock...............       419     1,103
  Parent's investment and advances.........................   424,506    18,119
                                                             --------  --------
Net cash provided by financing activities..................   425,227    19,222
                                                             --------  --------
Net increase in cash and cash equivalents..................   348,382       --
Cash and cash equivalents at beginning of period...........       --        --
                                                             --------  --------
Cash and cash equivalents at end of period.................  $348,382  $    --
                                                             ========  ========
Supplemental disclosure of non-cash investing and financing
 activities:
  Long-term financing for loans to unconsolidated wireless
   operating company.......................................  $  8,984  $    --
  Long-term financing to settle liabilities assumed on
   acquisition.............................................    33,608       --
  Long-term financing to purchase property and equipment...   240,759       --
  Facility fee due on long-term debt.......................     1,800       --
  Exercise of stock options for notes receivable...........       --        897
Supplemental disclosure of cash used for acquisition:
  Total purchase price.....................................    80,911       --
  Warrant issued for common stock..........................   (15,353)      --
  Liabilities assumed......................................   (59,258)      --
  Cash acquired............................................    (4,973)      --
                                                             --------  --------
  Cash used for acquisition................................  $  1,327  $    --
                                                             ========  ========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                       4
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1. The Company and Basis of Presentation

 The Company and Nature of Business

   Cricket Communications Holdings, Inc. (the "Company" or "Cricket
Communications Holdings"), a wholly-owned subsidiary of Leap Wireless
International, Inc. ("Leap"), is a wireless communications carrier that is
deploying and operating a low-cost, flat-rate wireless service in the United
States. The Company's service is operated by its wholly-owned subsidiary,
Cricket Communications, Inc. ("Cricket Communications"), and is marketed under
the name "Cricket". Cricket service was introduced in March 1999 in Tennessee
using the existing infrastructure of Chase Telecommunications, Inc. ("Chase
Telecommunications"), a company that Leap and Cricket Communications Holdings
acquired in March 2000 (See Note 2). The Company has introduced Cricket service
in other markets in Tennessee in 2000 and plans to introduce Cricket service to
additional markets in the United States in the future. The Company is comprised
of one business segment and all of its customers and long-lived assets are
located in the United States. The Company has guaranteed $225.0 million and
$668.0 million of senior and senior discount notes of Leap, respectively.

   The wireless licenses used by the Company to offer Cricket service are owned
by Leap. The Company plans to enter into long-term licensing agreements with
Leap for the use of the licenses. In 1999 and 2000, Leap has acquired or agreed
to acquire a number of additional wireless licenses throughout the United
States. Each of the pending agreements is subject to customary closing
conditions, including Federal Communications Commission ("FCC") approval, but
no assurance can be given that they will be closed on schedule or at all.

   In July 1999, the FCC issued an opinion and order that found Leap was
qualified to acquire and operate C-Block and F-Block PCS spectrum licenses in
the United States, subject to specified conditions. The order also approved
Leap's acquisition of 36 licenses in the federal government's reauction of
broadband PCS spectrum licenses and approved the transfer of three licenses in
North Carolina to Leap. Another wireless company has appealed the FCC's order.
Although Leap believes that the appeal will be denied, there can be no
assurance that it will prevail in connection with any further judicial review
of the order or that it will otherwise remain qualified to hold C-Block or F-
Block spectrum licenses.

   The FCC's grants of Leap's C-Block and F-Block licenses are subject to
certain conditions, which have been satisfied. Leap has a continuing
obligation, during the designated entity holding period for its C-Block and F-
Block licenses, to limit its debt to Qualcomm Incorporated ("Qualcomm") to 50%
or less of its outstanding debt and to ensure that persons who are or were
previously officers or directors of Qualcomm do not comprise a majority of
Leap's board of directors or a majority of its officers. If Leap fails to
continue to meet any of the conditions imposed by the FCC or otherwise fails to
maintain its qualification to own C-Block and F-Block licenses, that failure
could have a material adverse effect on the Company's financial condition and
business prospects.

 Incorporation, Capitalization and Basis of Presentation

   Cricket Communications Holdings was incorporated in Delaware on August 24,
1998. On June 22, 1999, Leap transferred to the Company its 7.2% equity
interest in Chase Telecommunications Holdings, Inc. ("Chase Telecommunications
Holdings") and indebtedness of Chase Telecommunications, a subsidiary of Chase
Telecommunications Holdings, owed to Leap, as well as certain additional assets
and liabilities (the "Transfer"). Leap purchased its equity interest in Chase
Telecommunications Holdings in December 1996. The financial statements reflect
the financial position, results of operations, cash flows and changes in
stockholders' equity (deficit) of the business that was transferred to the
Company from Leap as if: (i) the Company was a separate entity for all periods
presented, and (ii) the investment in Chase Telecommunications Holdings and
loans to Chase Telecommunications were entered into by the Company. The
financial statements have been prepared

                                       5
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(Continued)

using the historical basis in the assets and liabilities and historical results
of operations related to the Company's business. The Company had no cash from
December 1, 1996 (inception) through December 15, 1999. During this period,
when Company purchases were made, liabilities paid or investments and loans
made, the cash used by the Company was provided by Leap. Leap's investment and
advances have been converted into common stock of the Company.

   The accompanying interim condensed consolidated financial statements have
been prepared by the Company without audit, in accordance with the instructions
to Form 10-Q and, therefore, do not include all information and footnotes
necessary for a fair presentation of its financial position, results of
operations, cash flows and stockholders' equity in accordance with generally
accepted accounting principles. In the opinion of management, the unaudited
financial information for the interim periods presented reflects all
adjustments (which include only normal, recurring adjustments) necessary for a
fair presentation. These condensed consolidated financial statements and notes
thereto should be read in conjunction with the Company's consolidated financial
statements and notes thereto included in the Company's Transition Report on
Form 10-K for the transition period from September 1, 1999 to December 31,
1999, filed with the Securities and Exchange Commission on October 30, 2000.
Operating results for interim periods are not necessarily indicative of
operating results for an entire fiscal year.

   The condensed consolidated financial statements are prepared using generally
accepted accounting principles. These principles require management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities, and the
reported amounts of revenues and expenses. Actual results could differ from
those estimates.

 Leap Acquisition

   On June 15, 2000, Leap acquired the remaining 5.11% of the Company that it
did not already own. These shares were owned by individuals and entities,
including directors and employees of Leap and the Company. Each issued and
outstanding share of the Company's common stock not held by Leap was converted
into the right to receive 0.315 of a fully paid and nonassessable share of
Leap's common stock. As a result, 1,048,635 shares of Leap's common stock were
issued. Leap also assumed Chase Telecommunications Holdings' warrant to
purchase 1% of the common stock of the Company, which was converted into a
warrant to acquire 202,566 shares of Leap's common stock, for an aggregate
exercise price of $1.0 million. The aggregate fair value of the Leap shares
issued and warrant assumed in excess of the carrying value of the interest
acquired was allocated to goodwill. As a result, the Company recorded goodwill
of $29.2 million in June 2000 under the push-down method of accounting which is
being amortized over 20 years. In addition, Leap assumed all unexpired and
unexercised stock options of the Company outstanding at the time of the merger,
whether vested or unvested, which upon conversion amounted to options to
purchase 407,784 shares of Leap's common stock.

 Change in Fiscal Year

   On July 31, 2000, the Board of Directors of the Company elected to change
its fiscal year from a year ending on August 31 to a year ending on December
31. The first new twelve-month fiscal year will end on December 31, 2000. As a
result of the change in year end, the Company has issued consolidated financial
statements as of December 31, 1999 and for the transition period from September
1, 1999 to December 31, 1999 and is required to issue interim financial
statements for the three and nine months ended September 30, 2000. Since the
Company's previous interim financial statements were as of May 31, 2000, the
Company is also required to issue interim financial statements for the month of
June 2000.

                                       6
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(Continued)


 Future Accounting Requirements

   In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities," which is effective for the
Company's year ending December 31, 2001. In June 2000, the FASB issued SFAS No.
138 which amended SFAS No. 133 for certain derivative instruments and hedging
activities. Under SFAS No. 133, all derivatives must be recognized as assets
and liabilities and measured at fair value. The Company does not expect that
the adoption of SFAS No. 133 will have a material impact on its consolidated
financial position or results of operations.

   In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements." SAB No. 101 summarizes certain of the Staff's interpretations in
applying generally accepted accounting principles to revenue recognition. The
provisions of SAB No. 101 are effective for the Company's quarter ending
December 31, 2000. The Company does not expect that the adoption of SAB No. 101
will have a material impact on its consolidated financial position or results
of operations.

Note 2. Investment in and Loans to Chase Telecommunications Holdings

   In March 2000, Leap and the Company completed the acquisition of
substantially all of the assets of Chase Telecommunications Holdings, including
wireless licenses. The purchase price included approximately $6.3 million in
cash, the assumption of principal amounts of liabilities that totaled
approximately $138.0 million (with a fair value of $131.3 million), a warrant
to purchase 1% of the common stock of the Company at an exercise price of $1.0
million (which had a fair value of approximately $15.3 million at the
acquisition date determined using the Black Scholes option pricing model), and
contingent earn-out payments of up to $41.0 million (plus certain expenses)
based on the earnings of the business acquired during the fifth full year
following the closing of the acquisition. Leap purchased the wireless licenses
and related FCC debt and the Company acquired all the outstanding capital stock
of Chase Telecommunications, a subsidiary of Chase Telecommunications Holdings.
Under the purchase method of accounting, the total estimated fair value of the
Company's acquisition of Chase Telecommunications was $80.9 million, of which
$43.2 million has been allocated to property and equipment and other assets and
$37.7 million has been allocated to intangible assets, primarily goodwill,
which is being amortized over 20 years. Unaudited pro forma results of
operations are provided to reflect the acquisition as if it had occurred as of
January 1, 1999 (in thousands):

<TABLE>
<CAPTION>
                                                             Nine Months Ended
                                                               September 30,
                                                             ------------------
                                                               2000      1999
                                                             --------  --------
                                                                (Unaudited)
   <S>                                                       <C>       <C>
   Operating revenues....................................... $ 17,380  $  3,771
   Net loss................................................. $(52,061) $(39,931)
</TABLE>

   The unaudited pro forma results of operations have been prepared for
comparative purposes only and do not purport to be indicative of the results of
operations which actually would have resulted had the acquisition occurred on
the date indicated, or which may result in the future.

   Prior to Leap's and the Company's acquisition of substantially all the
assets of Chase Telecommunications Holdings in March 2000, the Company's
investment in Chase Telecommunications Holdings was accounted for under the
equity method. The Company recorded equity losses from Chase Telecommunications
Holdings of $0 and $10.4 million during the three and nine months ended
September 30, 2000, respectively, and

                                       7
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(Continued)

$2.5 million, $4.0 million and $11.2 million during the month ended June 30,
1999 and the three and nine months ended September 30, 1999, respectively.

   Condensed financial information for Chase Telecommunications Holdings is
summarized as follows (in thousands):

<TABLE>
<CAPTION>
                                                                  December 31,
                                                                      1999
                                                                  ------------
   <S>                                                            <C>
   Current assets................................................  $   3,865
   Non-current assets............................................     89,020
   Current liabilities...........................................     (6,397)
   Non-current liabilities.......................................   (180,901)
                                                                   ---------
     Total stockholders' deficit.................................    (94,413)
   Other stockholders' share of capital..........................    (87,615)
                                                                   ---------
   Company's share of capital....................................  $  (6,798)
                                                                   =========
   Investments in and loans receivable from Chase
    Telecommunications Holdings..................................  $   8,562
                                                                   =========
</TABLE>

<TABLE>
<CAPTION>
                                              Three Months     Nine Months
                                                 Ended            Ended
                                Month Ended   ------------  ------------------
                                  June 30,            September 30,
                                ------------  --------------------------------
                                2000  1999    2000  1999      2000      1999
                                ---- -------  ---- -------  --------  --------
                                                (Unaudited)
<S>                             <C>  <C>      <C>  <C>      <C>       <C>
Operating revenues............. $ -- $   364  $ -- $ 1,723  $  2,971  $  3,642
                                ---- -------  ---- -------  --------  --------
Operating losses...............   --  (1,338)   --  (3,956)   (4,817)  (11,612)
Other income (expense), net....   --  (1,236)   --  (4,435)  (10,330)  (11,798)
                                ---- -------  ---- -------  --------  --------
  Net loss.....................   --  (2,574)   --  (8,391)  (15,147)  (23,410)
Other stockholders' share of
 net loss......................   --    (235)   --  (3,290)   (3,210)   (9,528)
                                ---- -------  ---- -------  --------  --------
Company's share of net loss....   --  (2,809)   --  (5,101)  (11,937)  (13,882)
Elimination of intercompany
 transactions..................   --     309    --   1,101     1,498     2,682
                                ---- -------  ---- -------  --------  --------
  Equity in net loss of Chase
   Telecommunications
   Holdings.................... $ -- $(2,500) $ -- $(4,000) $(10,439) $(11,200)
                                ==== =======  ==== =======  ========  ========
</TABLE>

Note 3. Long Term Debt

 Lucent Supply and Credit Agreements

   In September 1999, Cricket Communications agreed to purchase up to $330.0
million of infrastructure products and services from Lucent Technologies, Inc.
("Lucent"), and in June 2000, increased the value of products and services that
can be purchased under the agreement to up to $900.0 million. The purchase
agreement is subject to early termination at Cricket Communications'
convenience subject to payments for products and services purchased by Cricket
Communications. Lucent agreed to finance these purchases plus additional
working capital under a credit facility. The credit facility originally
permitted up to $641.0 million in total borrowings, which was increased to up
to $1,350.0 million in June 2000, with borrowing availability generally based
on a ratio of the total amount of products and services purchased from Lucent.
Lucent is not required to make loans under the facility if the total of the
loans held directly or supported by Lucent is an amount greater than $815.0
million. The credit agreement contains various covenants and conditions typical
for

                                       8
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(Continued)

a loan of this type, including minimum levels of customers and covered
potential customers that must increase over time, limits on annual capital
expenditures, dividend restrictions and other financial ratio tests. The
obligations under the credit agreement, together with the obligations under
similar facilities from Nortel Networks, Inc. ("Nortel") and Ericsson Wireless
Communications, Inc. ("Ericsson"), are secured by all of the stock of Cricket
Communications, its subsidiaries and the stock of each special purpose
subsidiary of Leap formed to hold wireless licenses used in Cricket
Communications' business, and all of their respective assets. Borrowings under
the credit facility accrue interest at a rate equal to LIBOR plus 3.5% to 4.25%
or a bank base rate plus 2.5% to 3.25%, in each case with the specific rate
based on the ratio of total indebtedness to EBITDA. Cricket Communications must
pay Lucent a commitment fee equal to 1.25% per annum on the unused commitment
under the facility, decreasing to 0.75% per annum. Principal payments are
scheduled to begin after three years with a final maturity after eight years.
Repayment is weighted to the later years of the repayment schedule. At
September 30, 2000, the Company had $212.6 million outstanding under the Lucent
credit agreement at an interest rate of 11.0%. In addition, the Company had
amounts payable to Lucent of $96.2 million which have been included in other
long-term liabilities at September 30, 2000.

 Nortel Supply and Credit Agreements

   In August 2000, Cricket Communications entered into a three-year supply
agreement with Nortel for the purchase of infrastructure products and services.
Nortel agreed to finance these purchases plus additional working capital under
a credit facility. The credit facility permits up to $525.0 million in total
borrowings, with borrowing availability generally based on a ratio of the total
amount of products and services purchased from Nortel. The credit agreement
contains various covenants and conditions typical for a loan of this type,
including minimum levels of customers and covered potential customers that must
increase over time, limits on annual capital expenditures and other financial
ratio tests. The obligations under the credit agreement, together with the
obligations under similar facilities with Lucent and Ericsson, are secured by
all of the stock of Cricket Communications, its subsidiaries and the stock of
each special purpose subsidiary of Leap formed to hold wireless licenses used
in Cricket Communications' business, and all of their respective assets.
Borrowings under the credit facility accrue interest at a rate equal to LIBOR
plus 3.5% to 4.25% or a bank base rate plus 2.5% to 3.25%, in each case with
the specific rate based on the ratio of total indebtedness to EBITDA. Cricket
Communications must pay a commitment fee equal to 1.25% per annum on the unused
commitment under the credit facility, decreasing to 0.75% per annum. Principal
payments are scheduled to begin after three years with a final maturity after
eight years. Repayment is weighted to the later years of the repayment
schedule. At September 30, 2000, no amounts were outstanding under the Nortel
credit agreement.

 Ericsson Supply and Credit Agreements

   In October 2000, Cricket Communications entered into a three-year supply
agreement with Ericsson for the purchase of up to $330.0 million of
infrastructure products and services. Ericsson Credit AB agreed to finance
these purchases plus additional working capital under a credit facility. These
agreements amended and replaced the binding memorandum of agreement between the
parties dated September 20, 1999. The credit facility permits up to $495.0
million in total borrowings, with borrowing availability generally based on a
ratio of the total amount of products and services purchased from Ericsson. The
credit agreement contains various covenants and conditions typical for a loan
of this type, including minimum levels of customers and covered potential
customers that must increase over time, limits on annual capital expenditures,
dividend restrictions and other financial ratio tests. The obligations under
the credit agreement, together with the obligations under similar facilities
from Lucent and Nortel, are secured by all of the stock of Cricket
Communications, its subsidiaries and the stock of each special purpose
subsidiary of Leap formed to hold wireless licenses used in the Cricket
Communications' business, and all of their respective assets. Borrowings under
the credit facility

                                       9
<PAGE>

                     CRICKET COMMUNICATIONS HOLDINGS, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(Continued)

accrue interest at a rate equal to LIBOR plus 3.5% to 4.25% or a bank base rate
plus 2.5% to 3.25%, in each case with the specific rate based on the ratio of
total indebtedness to EBITDA. Cricket Communications must pay a commitment fee
equal to 1.25% per annum on the unused commitment under the credit facility,
decreasing to 0.75% per annum. Principal payments are scheduled to begin after
three years with a final maturity after eight years. Repayment is weighted to
the later years of the repayment schedule.

   Cricket Communications, Lucent, Nortel and Ericsson have entered into an
agreement pursuant to which Lucent, Nortel and Ericsson agreed to share
collateral and the parties agreed that the Cricket Communications' total
outstanding balance of loans to the three vendors shall not exceed $1,845.0
million.

Note 4. Related Party Transactions

 Leap Wireless International, Inc.

   The unaudited condensed consolidated financial statements include the
allocation of shared general and administrative costs with Leap subsequent to
the Transfer. Labor and other direct costs of Leap have been allocated to the
Company based on estimates of incremental efforts expended and incremental
costs incurred related to the Company's business. The Company's share of these
costs was $0.3 million, $0.8 million and $2.3 million for the month ended June
30, 2000 and the three and nine months ended September 30, 2000. Management
believes these allocations reasonably approximate costs incurred by Leap on
behalf of the Company's operations. However, the costs as allocated to the
Company are not necessarily indicative of the costs that would have been
incurred if the Company had performed these functions as a stand-alone entity.

   In conjunction with Leap's and the Company's acquisition of substantially
all the assets of Chase Telecommunications Holdings in March 2000, Leap granted
the Company the right to use wireless licenses acquired from Chase
Telecommunications Holdings and held by another subsidiary of Leap. The Company
recorded $0.1 million, $0.3 million and $0.6 million for the month ended June
30, 2000 and the three and nine months ended September 30, 2000 for its right
to use wireless licenses.

   In November and December 1999, the Company issued 2,133,067 shares of its
common stock to Leap related to the conversion of investments and advances
totaling $15.2 million provided to the Company from June 22, 1999 to December
15, 1999 and 9,700,266 shares of its common stock to Leap for a promissory note
of $51.3 million and the settlement of accounts payable in the amount of $4.5
million. The promissory note bore interest at the rate of 10.0% per annum and
was payable on demand. In March and April 2000, Leap repaid the promissory note
in full.

 Other Related Parties

   In December 1999, the Company issued 473,333 shares of its common stock to
three directors of the Company and a director of Leap for promissory notes
totaling $2.8 million. The promissory notes bore interest at the rate of 10.0%
per annum and were payable on demand. In April and May 2000, the promissory
notes were paid in full.

Note 5. Contingencies

   Various claims arising in the course of business, seeking monetary damages
and other relief, are pending. The amount of the liability, if any, from such
claims cannot be determined with certainty; however, in the opinion of
management, the ultimate liability for such claims will not have a material
adverse effect on the Company's consolidated financial position, results of
operations or cash flows.

                                    * * * *

                                       10
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

   The following information should be read in conjunction with the condensed
consolidated financial statements and notes thereto included in Item 1 of this
Quarterly Report and the audited consolidated financial statements and notes
thereto and the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations" included in the Company's
Transition Report on Form 10-K for the transition period from September 1, 1999
to December 31, 1999, filed with the Securities and Exchange Commission on
October 30, 2000.

   Except for the historical information contained herein, this document
contains forward-looking statements reflecting management's current forecast of
certain aspects of Cricket's future. Some forward-looking statements can be
identified by forward-looking words such as "believe," "may," "could," "will,"
"estimate," "continue," "anticipate," "intend," "seek," "plan," "expect,"
"should," "would" and similar expressions in the report. It is based on current
information, which Cricket has assessed but which by its nature is dynamic and
subject to rapid and even abrupt changes. Cricket's actual results could differ
materially from those stated or implied by such forward looking statements due
to risks and uncertainties associated with Cricket's business. Factors that
could cause actual results to differ include but are not limited to: changes in
the economic conditions of the various markets Cricket serves which could
adversely affect the market for wireless services; the ability of Leap or its
operating companies, including Cricket, to access capital markets; Cricket's
ability to roll out networks in accordance with its plans; failure of the
systems to perform according to expectations; the effect of competition; the
acceptance of the product offering by our target customers; Cricket's ability
to retain customers; our ability to maintain our cost, market penetration and
pricing structure in the face of competition; uncertainties relating to
negotiating and executing definitive agreements and the closing of transactions
described in this report; rulings by courts or the FCC adversely affecting
Leap's rights to own and/or operate certain wireless licenses; as well as other
factors detailed in our SEC filings. The forward-looking statements should be
considered in the context of these and other risk factors detailed in the
section entitled "Risk Factors" detailed in the Company's Transition Report on
Form 10-K for the transition period from September 1, 1999 to December 31,
1999, filed with the Securities and Exchange Commission on October 30, 2000.
Investors and prospective investors are cautioned not to place undue reliance
on such forward-looking statements. We disclaim any obligation to update the
forward-looking statements contained herein to reflect future events or
developments.

   As used in this report, the terms "we," "our" or "us" refer to Cricket
Communications Holdings and its consolidated subsidiaries, unless the context
suggests otherwise.

Overview

   Cricket Communications Holdings, a wholly-owned subsidiary of Leap Wireless
International, Inc., is a wireless communications carrier with an innovative
approach to providing digital wireless service that is designed to appeal to
the mass market. We intend to transform wireless into a mass consumer product
by deploying customer-oriented, low-cost, simple wireless services. We
generally seek to address a much broader population segment than incumbent
wireless operators have addressed to date. In the United States, we are
employing an innovative business strategy to extend the benefits of mobility to
the mass market by offering digital wireless service under the brand name
Cricket that is as simple as, and priced at rates competitive with, traditional
landline service. Chase Telecommunications, Inc., a company we acquired in
March 2000, introduced Cricket service in Chattanooga and Nashville, Tennessee
in March 1999 and January 2000, respectively. Cricket service is operated by
Cricket Communications, Inc., our wholly-owned subsidiary.

   In June 2000, through a subsidiary merger, Leap acquired the 5.11% of
Cricket Communications Holdings that it did not already own. These shares were
owned by individuals and entities, including directors and employees of Leap
and Cricket Communications Holdings. Under the terms of the merger, each issued
and outstanding share of our common stock not held by Leap was converted into
the right to receive 0.315 of a

                                       11
<PAGE>

fully paid and non-assessable share of Leap common stock. As a result, an
aggregate of 1,048,635 shares of Leap common stock were issued. Leap also
assumed Chase Telecommunications Holdings' warrant to purchase 1% of the common
stock of Cricket Communications Holdings, which was converted into a warrant to
acquire 202,566 shares of its common stock, at an aggregate exercise price of
$1.0 million. The aggregate fair value of the Leap shares issued and warrant
assumed in excess of the carrying value of the interest acquired was allocated
to goodwill. As a result, goodwill of $29.2 million was recorded in June 2000
under the push-down method of accounting which is being amortized over 20
years. In addition, Leap assumed all unexpired and unexercised Cricket
Communications Holdings stock options outstanding at the time of the merger,
whether vested or unvested, which upon conversion amounted to options to
purchase 407,784 shares of Leap common stock.

   We are in the early stages of launching our networks and our financial
results continue to reflect the considerable investment associated with
completion of our network build-outs and the initial launch of commercial
service in new markets. As we continue to expand our operations, our net
operating losses are expected to grow.

Recent or Pending Acquisitions

   Chase Telecommunications. In March 2000, Leap and Cricket Communications
Holdings completed the acquisition of substantially all of the assets of Chase
Telecommunications Holdings, including wireless licenses. The purchase price
included approximately $6.3 million in cash, the assumption of principal
amounts of liabilities that totaled approximately $138.0 million (with a fair
value of approximately $131.3 million), a warrant to purchase 1% of our common
stock (which has been converted into a right to acquire 202,566 shares of Leap
common stock) at an exercise price of $1.0 million (which had a fair value of
approximately $15.3 million at the acquisition date determined using the Black
Scholes option pricing model), and contingent earn-out payments of up to $41.0
million (plus certain expenses) based on the earnings of the business acquired
during the fifth full year following the closing of the acquisition. Leap
purchased the wireless licenses and related FCC debt and Cricket Communications
Holdings acquired all the outstanding common stock of Chase Telecommunications,
Inc., a subsidiary of Chase Telecommunications Holdings. Under the purchase
method of accounting, the total estimated fair value of the acquisition of
Chase Telecommunications by Cricket Communications Holdings was $80.9 million,
of which $43.2 million has been allocated to property and equipment and other
assets and $37.7 million has been allocated to intangible assets, primarily
goodwill, which is being amortized over 20 years.

   Wireless Licenses. Our business is substantially dependent on the use of
various licenses, which Leap has acquired or agreed to acquire.

   In July 1999, the FCC issued an option and order that found that Leap was
qualified to acquire C-Block and F-Block licenses. The order also approved
Leap's acquisition of the 36 C-Block licenses for which Leap was the high
bidder in the FCC's 1999 spectrum reauction, and approved the transfer to Leap
for three F-Block licenses covering portions of North Carolina, in each case
subject to the fulfillment of some conditions. In October 1999, the FCC issued
the 36 licenses Leap acquired in the reauction.

   The FCC's grants of Leap's C-Block and F-Block licenses are subject to
certain conditions. Each of the conditions imposed by the FCC in the opinion
and order has been satisfied. Leap has a continuing obligation, during the
designated entity holding period for its C-Block and F-Block licenses, to limit
its debt to Qualcomm to 50% or less of its outstanding debt and to ensure that
persons who are or were previously officers or directors of Qualcomm do not
comprise a majority of Leap's board of directors or a majority of its officers.
If Leap fails to continue to meet any of the conditions imposed by the FCC or
otherwise fails to maintain its qualification to own C-Block and F-Block
licenses, that failure could have a material adverse effect on our financial
condition and business prospects.

   Various parties previously challenged Leap's qualification to hold C-Block
and F-Block licenses, which challenges were rejected in the FCC's July 1999
order. One of these parties, a wireless operating company, requested that the
FCC review its order, as well as the order consenting to the transfer of
licenses to Leap from

                                       12
<PAGE>

Chase Telecommunications and PCS Devco. That wireless operating company also
has opposed all of Leap's pending assignment or transfer applications at the
FCC. In July 2000, the FCC affirmed its July 1999 order as well as the order
consenting to the transfer of licenses to Leap from Chase Telecommunications
and PCS Devco, and the wireless operating company subsequently appealed the
FCC's decision to the Court of Appeal for the D.C. Circuit, which appeal is
currently pending. In addition, Nextel Communications, Inc. has opposed one of
Leap's pending FCC applications, alleging that Leap may no longer be complaint
with C- and F-Block "total asset" eligibility requirements. Further judicial
review of the FCC's orders granting Leap licenses is possible. In addition,
licenses awarded to Leap at auction may be subject to the outcome of pending
judicial proceedings by parties challenging the auction process or the FCC's
decision or authority to auction or reauction certain C- or F-Block licenses.
Leap may also be affected by other pending or future FCC legislative or
judicial proceedings that generally affect the rules governing C- and F-Block
licenses or other designated entities. For example, recent FCC rules changes
have made it easier for large companies to acquire C- and F-Block licenses at
auction and in the aftermarket.

   Leap may not prevail in connection with any such appeals or proceedings and
Leap may not remain qualified to hold C-Block or F-Block licenses. If the FCC
determines that Leap is not qualified to hold C-Block or F-Block licenses, it
could take the position that all of Leap's licenses should be divested,
cancelled or reauctioned.

Presentation

   The wireless licenses used by us to offer Cricket service are owned by Leap.
We plan to enter into long-term licensing agreements with Leap for the use of
the licenses. In 1999 and 2000, Leap has acquired or agreed to acquire a number
of additional wireless licenses throughout the United States. Each of the
pending agreements is subject to customary closing conditions, including FCC
approval, but no assurance can be given that they will be closed on schedule or
at all.

   On July 31, 2000, our Board of Directors elected to change Cricket
Communications Holdings' fiscal year from a year ending on August 31 to a year
ending on December 31. The first new twelve-month fiscal year will end on
December 31, 2000. As a result of the change in year-end, we have issued
consolidated financial statements as of December 31, 1999 and for the
transition period from September 1, 1999 to December 31, 1999 and we are
required to issue interim financial statements for the three and nine months
ended September 30, 2000. Since our previous interim financial statements were
as of May 31, 2000, we are also required to issue interim financial statements
for the month of June 2000.

Results of Operations

Month Ended June 30, 2000 and Three and Nine Months Ended September 30, 2000
Compared to Month Ended June 30, 1999 and Three and Nine Months Ended September
30, 1999

   We incurred a net loss of $5.6 million, $18.2 million and $49.7 million,
respectively, during the month ended June 30, 2000 and the three and nine month
periods ended September 30, 2000, respectively, compared to a net loss of $5.4
million, $10.0 million and $27.6 million, respectively, in the corresponding
periods of the prior year. The increase in net loss relates primarily to the
consolidation of Chase Telecommunications from March 2000 and increased
operating expenses associated with the development and launch of commercial
service in new markets. As a result, total subscribers on our networks reached
approximately 62,500 subscribers at September 30, 2000.

   Prior to March 2000, we did not report any operating revenues or cost of
operating revenues and operations because our operating company was accounted
for under the equity method of accounting. We generated $2.0 million, $7.5
million and $14.4 million in revenues during the month ended June 30, 2000 and
the three and nine month periods ended September 30, 2000 from our operations
in Chattanooga and Nashville, Tennessee. We incurred $1.9 million, $10.7
million and $17.0 million in related cost of operating revenues and operations.

                                       13
<PAGE>

   We incurred $3.6 million, $12.9 million and $27.3 million of selling,
general and administrative expenses during the month ended June 30, 2000 and
the three and nine month periods ended September 30, 2000, respectively,
compared to $2.9 million, $6.0 million and $16.4 million in the corresponding
periods of the prior year. The increases compared to the corresponding periods
for the prior year were due primarily to increased expenses associated with the
development and support of commercial service in new markets. We expect that
selling, general and administrative expenses will continue to increase in the
future as a result of our planned network development and launch of Cricket
service in multiple U.S. markets.

   We incurred operating losses of $4.6 million, $19.7 million and $37.1
million during the month ended June 30, 2000 and the three and nine month
periods ended September 30, 2000, respectively, compared to operating losses of
$2.9 million, $6.0 million and $16.4 million in the corresponding periods of
the prior year. Increases over the corresponding periods of the prior year
primarily reflect the consolidation of Chase Telecommunications from March 2000
and the increase in market development costs in the United States. We expect
substantial growth in subscribers, operating revenues and operating expenses as
a result of our planned network development and launch of Cricket service in
multiple U.S. markets.

   Equity in net loss of Chase Telecommunications Holdings was $0, $0 and $10.4
million during the month ended June 30, 2000 and the three and nine month
periods ended September 30, 2000, respectively, compared to $2.5 million, $4.0
million and $11.2 million in the corresponding periods of the prior year.

   Interest income was $0.6 million, $6.4 million and $8.6 million during the
month ended June 30, 2000 and the three and nine month periods ended September
30, 2000, respectively. The increase in interest income relates to increased
balances of our cash and cash equivalents and investments, received from Leap
in June 2000.

   Interest expense was $1.7 million, $5.0 million and $10.9 million during the
month ended June 30, 2000 and the three and nine month periods ended September
30, 2000, respectively. Interest expense related primarily to borrowings from
Lucent for financing of our wireless communications networks in the United
States. There was no consolidated interest expense during the prior periods. We
expect interest expense to increase substantially in the future due to expected
additional borrowings used to fund the construction of wireless networks in
various markets across the United States.

Liquidity and Capital Resources

   Over the next twelve months from November 2000, we have budgeted a total of
approximately $1,233.0 million for capital expenditures for the build-out of
Cricket networks and to fund operating losses. Our actual expenditures may vary
significantly depending upon the progress of the build-out of our networks and
other factors, including unforeseen delays, cost overruns, unanticipated
expenses, regulatory expenses, engineering design changes and other
technological risks.

   As of September 30, 2000, we had a total of approximately $1,916.4 million
in unused capital resources for our future cash needs as follows:

  .  approximately $380.2 million in consolidated cash, cash equivalents and
     investments on hand; and

  .  approximately $1,536.2 million in commitments under vendor financing
     arrangements with Lucent Technologies, Nortel Networks and Ericsson,
     with availability based on a ratio of the total amounts of products and
     services purchased.

   Accordingly, we believe that we have adequate capital resources to fund our
operations for the next twelve months.

   We expect to incur significant operating losses and to generate significant
negative cash flow from operating activities in the future while we continue to
build-out our networks and build our customer base. Our

                                       14
<PAGE>

ability to satisfy our debt repayment obligations and covenants depends upon
our future performance, which is subject to a number of factors, many of which
are beyond our control. We cannot guarantee that we will generate sufficient
cash flow from our operating activities to meet our debt service and working
capital requirements, and we may need to refinance our indebtedness. However,
our ability to refinance our indebtedness will depend on, among other things,
our financial condition, the state of the public and private debt and equity
markets, the restrictions in the instruments governing our indebtedness and
other factors, some of which may be beyond our control. In addition, if we do
not generate sufficient cash flow to meet our debt service requirements or if
we fail to comply with the covenants governing our indebtedness, we may need
additional financing in order to service or extinguish our indebtedness. We may
not be able to obtain financing or refinancing on terms that are acceptable to
us, or at all.

   We expect that we will require significant additional financing over the
next several years to substantially complete the build-out of our planned
wireless networks in the U.S. These capital requirements include capital
expenditures for network construction, operating cash flow losses and other
working capital costs and debt service. As is typical for start-up
telecommunications networks, we expect our networks to incur operating expenses
significantly in excess of revenues in their early years of operations. Leap is
exploring other debt and equity financing alternatives, including the sale from
time to time of convertible preferred stock, convertible debentures and other
debt and equity securities. However, Leap may not be able to raise additional
capital on terms that are acceptable to it, or at all.

   Leap has announced that it intends to use a substantial portion of the net
proceeds from its February 2000 equity offering and units offering for capital
expenditures for the build out of Cricket networks, to fund operating losses
expected to be incurred by the Company, for the completed acquisition of
substantially all of the assets of Chase Telecommunications Holdings in March
2000 and to acquire additional wireless licenses to be used by the Company to
offer Cricket service. In June 2000, Leap contributed $369.7 million to us
subsequent to our merger with Leap.

Credit Facilities and Other Financing Arrangements

   Lucent Equipment Financing. In September 1999, Cricket Communications agreed
to purchase up to $330.0 million of infrastructure products and services from
Lucent Technologies, Inc., and in June 2000 increased the value of products and
services that can be purchased under the agreement to up to $900.0 million. The
purchase agreement is subject to early termination at Cricket Communications'
convenience subject to payments for products and services purchased. Lucent
agreed to finance these purchases plus additional working capital under a
credit facility. The credit facility originally permitted up to $641.0 million
in total borrowings which was increased to up to $1,350.0 million in June 2000,
with borrowing availability generally based on the total amount of products and
services purchased from Lucent. Lucent is not required to make loans under the
facility if the total of the loans held directly or supported by Lucent is an
amount greater than $815.0 million. The agreement contains various covenants
and conditions typical for a loan of this type, including minimum levels of
customers and covered potential customers that must increase over time, limits
on annual capital expenditures, dividend restrictions and other financial ratio
tests. Borrowings under the Lucent credit facility accrue interest at a rate
equal to LIBOR plus 3.5% to 4.25% or a bank base rate plus 2.5% to 3.25%, in
each case with the specific rate based on the ratio of total indebtedness to
EBITDA. Cricket Communications must pay a commitment fee equal to 1.25% per
annum on the unused commitment under the facility, decreasing to 0.75% per
annum. Principal payments are scheduled to begin after three years with a final
maturity after eight years. Repayment is weighted to the later years of the
repayment schedule. The obligations under the Lucent credit agreement, together
with the obligations under similar facilities from Nortel Networks, Inc. and
Ericsson Wireless Communications, Inc., are secured by all of the stock of
Cricket Communications, its subsidiaries and the stock of each special purpose
subsidiary of Leap formed to hold wireless licenses used in Cricket
Communications' business, and all of their respective assets. At September 30,
2000, we had $212.6 million outstanding under the Lucent credit agreement at an
interest rate of 11.0%. In addition, we had amounts payable to Lucent of $96.2
million which have been included in other long-term liabilities.

                                       15
<PAGE>

   Nortel Equipment Financing. In August 2000, Cricket Communications entered
into a three-year supply agreement with Nortel for the purchase of
infrastructure products and services. Nortel agreed to finance these purchases
plus additional working capital under a credit facility. The credit facility
permits up to $525.0 million in total borrowings, with borrowing availability
based on a ratio of the total amount of products and services purchased from
Nortel. The credit agreement contains various covenants and conditions typical
for a loan of this type, including minimum levels of customers and covered
potential customers that must increase over time, limits on annual capital
expenditures and other financial ratio tests. The obligations under the credit
agreement, together with the obligations under similar facilities from Lucent
and Ericsson, are secured by all of the stock of Cricket Communications, its
subsidiaries and the stock of each special purpose subsidiary of Leap formed to
hold wireless licenses used in Cricket Communications' business, and all of
their respective assets. Borrowings under the credit facility accrue interest
at a rate equal to LIBOR plus 3.5% to 4.25% or a bank base rate plus 2.5% to
3.25%, in each case with the specific rate based on the ratio of total
indebtedness to EBITDA. Cricket Communications must pay a commitment fee equal
to 1.25% per annum on the unused commitment under the credit facility,
decreasing to 0.75% per annum. Principal payments are scheduled to begin after
three years with a final maturity after eight years. Repayment is weighted to
the later years of the repayment schedule. At September 30, 2000, no amounts
were outstanding under the Nortel credit agreement.

   Ericsson Equipment Financing. In October 2000, Cricket Communications
entered into a three-year supply agreement with Ericsson for the purchase of up
to $330.0 million of infrastructure products and services. Ericsson Credit AB
agreed to finance these purchases plus additional working capital under a
credit facility. These agreements amended and replaced the binding memorandum
of agreement between the parties dated September 20, 1999. The credit facility
permits up to $495.0 million in total borrowings, with borrowing availability
based on a ratio of the total amount of products and services purchased from
Ericsson. The credit agreement contains various covenants and conditions
typical for a loan of this type, including minimum levels of customers and
covered potential customers that must increase over time, limits on annual
capital expenditures, dividend restrictions and other financial ratio tests.
The obligations under the credit agreement, together with the obligations under
similar facilities from Lucent and Nortel, are secured by all of the stock of
Cricket Communications, its subsidiaries and the stock of each special purpose
subsidiary of Leap formed to hold wireless licenses used in Cricket
Communications' business, and all their respective assets. Borrowings under the
credit facility accrue interest at a rate equal to LIBOR plus 3.5% to 4.25% or
a bank base rate plus 2.5% to 3.25%, in each case with the specific rate based
on the ratio of total indebtedness to EBITDA. Cricket Communications must pay a
commitment fee equal to 1.25% per annum on the unused commitment under the
credit facility, decreasing to 0.75% per annum. Principal payments are
scheduled to begin after three years with a final maturity after eight years.
Repayment is weighted to the later years of the repayment schedule.

   Cricket Communications, Lucent, Nortel and Ericsson have entered into an
agreement pursuant to which Lucent, Nortel and Ericsson agreed to share
collateral and the parties agreed that Cricket Communications' total
outstanding balance of loans to the three vendors shall not exceed $1,845.0
million.

Operating Activities

   We used $6.0 million in cash for operating activities during the nine month
period ended September 30, 2000 compared to $7.9 million in the corresponding
period of the prior year. The decrease was primarily attributable to our change
in working capital. We expect that cash used in operating activities will
increase substantially in the future as a result of our planned development and
launch of Cricket service in multiple U.S. markets.

Investing Activities

   Cash used in investing activities was $70.9 million during the nine-month
period ended September 30, 2000 compared to $11.3 million in the corresponding
period of the prior year. Investments during the nine-month period ended
September 30, 2000 consisted of loans to Chase Telecommunications of $9.9
million, the acquisition of Chase Telecommunications for $1.3 million net of
cash acquired, the purchase of held-to-

                                       16
<PAGE>

maturity investments of $31.8 million and capital expenditures of $27.8
million. Cash used in investing activities in the corresponding period
primarily consisted of loans to Chase Telecommunications. In the remainder of
fiscal 2000, we expect to make significant investments in capital assets,
including network equipment.

Financing Activities

   Cash provided by financing activities during the nine-month period ended
September 30, 2000 was $425.2 million compared to $19.2 million in the
corresponding period of the prior year and primarily represents funding from
Leap. In June 2000, Leap contributed $369.7 million of net proceeds from its
February 2000 units offering.

Future Accounting Requirements

   In June 1998, the Financial Accounting Standards Board issued ("FASB")
Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which is effective for the year ending
December 31, 2001. In June 2000, the FASB issued SFAS No. 138 which amended
SFAS No. 133 for certain derivative instruments and hedging activities. Under
SFAS No. 133, all derivatives must be recognized as assets and liabilities and
measured at fair value. We do not expect that the adoption of SFAS No. 133 will
have a material impact on our consolidated financial position or results of
operations.

   In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements". SAB No. 101 summarizes certain of the Staff's interpretations in
applying generally accepted accounting principles to revenue recognition. The
provisions of SAB No. 101 are effective for the Company's quarter ending
December 31, 2000. Leap does not expect that the adoption of SAB No. 101 will
have a material impact on its consolidated financial position or results of
operations.

                                       17
<PAGE>

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Interest Rate Risk

   Our exposure to market risk for changes in interest rates relates primarily
to our variable rate long-term debt obligations. For a description of our long-
term debt obligations, see Note 3 to the Condensed Consolidated Financial
Statements, which are included elsewhere herein. The general level of U.S.
interest rates and/or LIBOR affect the interest expense that we recognize on
our variable rate long-term debt obligations. As of September 30, 2000, the
principal amounts of our variable rate long-term debt obligations amounted to
approximately $212.6 million. An increase of 10% in interest rates would
increase our interest expense for the next twelve months by approximately $2.3
million. This hypothetical amount is only suggestive of the effect of changes
in interest rates on our results of operations for the next twelve months.

                                       18
<PAGE>

                                    PART II
                               OTHER INFORMATION

Item 1. Legal Proceedings

   In July 1999, the FCC issued an opinion and order that found that Leap was
qualified to acquire C-Block and F-Block licenses. The order also approved
Leap's acquisition of the 36 C-Block licenses for which Leap was the high
bidder in the FCC's 1999 spectrum reauction, and approved the transfer to Leap
of three F-Block licenses covering portions of North Carolina, in each case
subject to the fulfillment of some conditions. Various parties previously
challenged Leap's qualification to hold C-Block and F-Block licenses, which
challenges were rejected in the FCC's July 1999 order. One of these parties,
Carolina PCS Limited Partnership I, L.P., a wireless operating company,
requested that the FCC review its order, as well as the order consenting to the
transfer of licenses to Leap from Chase Telecommunications and PCS Devco. In
July 2000, the FCC affirmed its July 1999 order, as well as the order
consenting to the transfer of licenses to Leap from Chase Telecommunications
and PCS Devco, and Carolina PCS subsequently appealed the FCC's decision to the
U.S. Court of Appeal for the D.C. Circuit. Leap has filed a motion seeking
summary dismissal of this appeal, based upon Leap's belief that Carolina PCS
has no standing to challenge the FCC's July 2000 order. The FCC has filed in
support of Leap's motion, which awaits disposition by the Court. Leap believes
the arguments of Carolina PCS are without merit and intends to vigorously
contest the appeal.

   Various claims arising in the course of business, seeking monetary damages
and other relief, are pending. The amount of the liability, if any, from such
claims cannot be determined with certainty; however, in the opinion of Leap's
management, the ultimate liability for such claims will not have a material
adverse effect on Leap's consolidated financial position, results of operations
or cash flows.

Item 2. Changes in Securities and Use of Proceeds

   None.

Item 3. Defaults Upon Senior Securities

   None.

Item 4. Submission of Matters to a Vote of Security Holders

   In June 2000, the merger of a new, wholly-owned subsidiary of Leap into
Cricket, with Cricket being the surviving corporation, was submitted to the
stockholders of Cricket for approval. In connection with the merger, each share
of Cricket common stock would be converted into 0.315 of a share of Leap common
stock. In addition, Leap would assume the Cricket stock option plan, and all
outstanding options to acquire Cricket common stock would be converted into
options to acquire Leap common stock, as adjusted for the exchange ratio in the
merger. In order to proceed with the proposed merger, Leap required that all
holders of Cricket common stock consent to the transaction. The stockholders of
Cricket unanimously approved the merger by written consent.

Item 5. Other Information

   None.

                                       19
<PAGE>

Item 6. Exhibits and Reports on Form 8-K

   (a) Index to Exhibits:

<TABLE>
<CAPTION>
 Exhibit
   No.                             Description of Exhibit
 -------                           ----------------------
 <C>        <S>
 4.2(1)     Trust Indenture, dated as of February 23, 2000, by and among Leap
            Wireless International, Inc., Cricket Communications Holdings, Inc.
            and State Street Bank and Trust Company (including Forms of Notes).
 4.2.1(2)   Supplemental Indenture, dated as of June 13, 2000, by and among
            Cricket Merger Sub, Inc., Leap Wireless International, Inc.,
            Cricket Communications Holdings, Inc. and State Street Bank and
            Trust Company.
 10.6(2)+   Amended and Restated System Equipment Purchase Agreement, entered
            into as of June 30, 2000, by and between Cricket Communications,
            Inc. and Lucent Technologies Inc. Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.7(2)+   Credit Agreement, dated as of September 20, 1999, as Amended and
            Restated as of October 20, 2000, among Cricket Communications
            Holdings, Inc., Cricket Communications, Inc., the lenders party
            thereto and Lucent Technologies, Inc., as Administrative Agent
            (including exhibits thereto). Portions of this exhibit (indicated
            by asterisks) have been omitted pursuant to a request for
            confidential treatment pursuant to Rule 24b-2 under the Securities
            Exchange Act of 1934.
 10.8(2)+   System Equipment Purchase Agreement, effective as of September 20,
            1999, by and between Cricket Communications, Inc. and Ericsson
            Wireless Communications Inc. Portions of this exhibit (indicated by
            asterisks) have been omitted pursuant to a request for confidential
            treatment pursuant to Rule 24b-2 under the Securities Exchange Act
            of 1934.
 10.9(2)+   Credit Agreement, dated as of October 20, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Ericsson Credit AB, as Administrative
            Agent (including exhibits thereto). Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.10(2)+  System Equipment Purchase Agreement, effective as of August 28,
            2000, by and between Cricket Communications, Inc. and Nortel
            Networks Inc. Portions of this exhibit (indicated by asterisks)
            have been omitted pursuant to a request for confidential treatment
            pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
 10.11(2)+  Credit Agreement, dated as of August 28, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Nortel Networks Inc., as Administrative
            Agent (including exhibits thereto). Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.11.1(2) First Amendment, dated as of October 20, 2000, to the Credit
            Agreement, dated as of August 28, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Nortel Networks Inc., as Administrative
            Agent (including exhibits thereto).
 27.1*      Financial Data Schedule.
</TABLE>
--------
 * Filed herewith.

 + A request for confidential treatment with respect to portions of this
   exhibit which have been omitted (indicated by asterisks) pursuant to Rule
   24b-2 under the Securities Exchange Act of 1934 is currently pending.

(1) Filed as an exhibit to Leap's Quarterly Report on Form 10-Q for the quarter
    ended February 29, 2000, as filed with the SEC on April 14, 2000, and
    incorporated herein by reference.

(2) Filed as an exhibit to Leap's Quarterly Report on Form 10-Q for the quarter
    ended September 30, 2000, as filed with the SEC on November 14, 2000, and
    incorporated herein by reference.

                                       20
<PAGE>

   (b) Reports on Form 8-K.

   A Current Report on Form 8-K was filed on August 30, 2000 announcing that on
July 31, 2000, the Board of Directors of Cricket Communications Holdings, Inc.,
a Delaware corporation (the "Company"), elected to change its fiscal year from
a year ending on August 31 to a year ending on December 31. The first new
twelve-month fiscal year will end on December 31, 2000. The four-month
transition period beginning September 1, 1999, and ending December 31, 1999,
was reported on a Transition Report on Form 10-K that was filed with the
Securities and Exchange Commission on October 30, 2000, pursuant to the
requirements of the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.

                                       21
<PAGE>

                                   SIGNATURES

   Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                          CRICKET COMMUNICATIONS HOLDINGS, INC.

Date: November 14, 2000                           /s/ Harvey P. White
                                          By: _________________________________
                                                      Harvey P. White
                                                Chairman and Chief Executive
                                                          Officer

Date: November 14, 2000                          /s/ Stephen P. Dhanens
                                          By: _________________________________
                                                     Stephen P. Dhanens
                                                 Vice President, Corporate
                                                         Controller
                                                 (Chief Accounting Officer)

                                       22
<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
 Exhibit
   No.                             Description of Exhibit
 -------                           ----------------------
 <C>        <S>
 4.2(1)     Trust Indenture, dated as of February 23, 2000, by and among Leap
            Wireless International, Inc., Cricket Communications Holdings, Inc.
            and State Street Bank and Trust Company (including Forms of Notes).
 4.2.1(2)   Supplemental Indenture, dated as of June 13, 2000, by and among
            Cricket Merger Sub, Inc., Leap Wireless International, Inc.,
            Cricket Communications Holdings, Inc. and State Street Bank and
            Trust Company.
 10.6(2)+   Amended and Restated System Equipment Purchase Agreement, entered
            into as of June 30, 2000, by and between Cricket Communications,
            Inc. and Lucent Technologies Inc. Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.7(2)+   Credit Agreement, dated as of September 20, 1999, as Amended and
            Restated as of October 20, 2000, among Cricket Communications
            Holdings, Inc., Cricket Communications, Inc., the lenders party
            thereto and Lucent Technologies, Inc., as Administrative Agent
            (including exhibits thereto). Portions of this exhibit (indicated
            by asterisks) have been omitted pursuant to a request for
            confidential treatment pursuant to Rule 24b-2 under the Securities
            Exchange Act of 1934.
 10.8(2)+   System Equipment Purchase Agreement, effective as of September 20,
            1999, by and between Cricket Communications, Inc. and Ericsson
            Wireless Communications Inc. Portions of this exhibit (indicated by
            asterisks) have been omitted pursuant to a request for confidential
            treatment pursuant to Rule 24b-2 under the Securities Exchange Act
            of 1934.
 10.9(2)+   Credit Agreement, dated as of October 20, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Ericsson Credit AB, as Administrative
            Agent (including exhibits thereto). Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.10(2)+  System Equipment Purchase Agreement, effective as of August 28,
            2000, by and between Cricket Communications, Inc. and Nortel
            Networks Inc. Portions of this exhibit (indicated by asterisks)
            have been omitted pursuant to a request for confidential treatment
            pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
 10.11(2)+  Credit Agreement, dated as of August 28, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Nortel Networks Inc., as Administrative
            Agent (including exhibits thereto). Portions of this exhibit
            (indicated by asterisks) have been omitted pursuant to a request
            for confidential treatment pursuant to Rule 24b-2 under the
            Securities Exchange Act of 1934.
 10.11.1(2) First Amendment, dated as of October 20, 2000, to the Credit
            Agreement, dated as of August 28, 2000, among Cricket
            Communications Holdings, Inc., Cricket Communications, Inc., the
            lenders party thereto and Nortel Networks Inc., as Administrative
            Agent (including exhibits thereto).
 27.1*      Financial Data Schedule.
</TABLE>
--------
*  Filed herewith.

 + A request for confidential treatment with respect to portions of this
   exhibit which have been omitted (indicated by asterisks) pursuant to Rule
   24b-2 under the Securities Exchange Act of 1934 is currently pending.

(1) Filed as an exhibit to Leap's Quarterly Report on Form 10-Q for the quarter
    ended February 29, 2000, as filed with the SEC on April 14, 2000, and
    incorporated herein by reference.

(2) Filed as an exhibit to Leap's Quarterly Report on Form 10-Q for the quarter
    ended September 30, 2000, as filed with the SEC on November 14, 2000, and
    incorporated herein by reference.